The economic stimulus package legislation that was approved this afternoon by Congress, and is now before the U.S. Senate, includes a shorter COBRA subsidy, say analysts reviewing the $790 billion American Recovery and Reinvestment Act. COBRA is the acronym for the 23-year-old Consolidated Omnibus Budget Reconciliation Act program.
The shorter subsidy is estimated to cost $24.7 billion, and would provide an estimated 7 million involuntarily terminated employees, laid off between Sept. 1, 2008 and Dec. 31, 2009, with a 65% federal subsidy for up to nine months of COBRA health insurance premiums.
The latest provisions are more liberal than the 50% subsidy in the Senate version, but don’t extend out as far as the 12-month subside time limit comprised in the last two versions.
The COBRA premium subsidy would not be available to individuals with an annual income exceeding $125,000, or to couples with annual incomes exceeding $250,000. Once the stimulus package hits the floor of the Senate, Democratic leaders will need to obtain at least 60 votes to approve and forward to President Obama for signature.
